On March 7, 2018, the United States Court of Appeals for the Sixth Circuit reversed a district court decision and ruled in favor of a transgender employee who claimed she was terminated by her employer based on her sex pursuant to Title VII of the Civil Rights Act of 1964. Aimee Stephens, formerly known as Anthony Stephens, worked as a funeral director at R.G. and G.R. Harris Funeral Homes, Inc. The funeral home had a dress code policy, requiring male employees to wear suits and female employees to wear skirts and business jackets. The funeral home provided free suits to the male employees, but did not (at least initially) provide female employees with any clothing to comply with the company’s dress code policy. Stephens informed the funeral home that she would be transitioning from male to female and therefore would begin to dress to be in compliance with the company’s dress code for females. Shortly thereafter, Stephens was terminated by the funeral home. As a result, Stephens filed a complaint with the Equal Employment Opportunity Commission (“EEOC”) who later brought a lawsuit on her behalf in the United States Eastern District of Michigan.
At the district court level, Stephens’ complaint claimed the funeral home violated Title VII when it terminated her due to 1) her transgender status; 2) her refusal to conform to sex-based stereotypes; and 3) alleged the funeral home administered a discriminatory clothing-allowance policy. The funeral home filed a motion for summary judgment arguing, among other things, that requiring the funeral home to employ Stephens while dressed as a woman would create an unjustified substantial burden on the owner’s sincerely-held religious beliefs, in violation of the Religious Freedom Restoration Act (“RFRA”). The district court basically agreed with the funeral home and granted its summary judgment. The EEOC appealed the district court’s decision to the Sixth Circuit Court of Appeals.
On appeal, the Sixth Circuit reversed the district court’s ruling, and held: 1) the funeral home unlawfully discriminated against Stephens on the basis of her sex; 2) the funeral home was not entitled to a RFRA defense because it did not establish that applying Title VII’s sex discrimination prohibitions would substantially burden the funeral home’s religious exercise; 3) the EEOC established that enforcing Title VII was the least restrictive means of furthering the compelling interest in eliminating workplace discrimination; and 4) the EEOC could bring a discriminatory-clothing-allowance claim because investigating the funeral home’s clothing-allowance policy was reasonably expected to grow from Stephens’ original sex discrimination charge submitted to the EEOC.
Cases in the Sixth Circuit regarding transgender employees being protected under Title VII is not a novel phenomenon. However, the significant take away from this case is that an employer is not entitled to asserting RFRA as a defense if it cannot establish that applying the anti-discrimination provisions of Title VII would substantially burden the employer’s ability to exercise his or her religious beliefs. Bottom line, the treatment of a transgender individual in compliance with Title VII is not a substantial burden to an employer and therefore will not, from the court’s perspective, prohibit the owner(s) of a company from maintaining his or her own religious beliefs.